Mobile Phones are meant to help us keep in touch while we are on the go. Setting yourself up with a handset and a Sim card is a big investment for anyone in countries like Uganda where average income is measured in the low of a few dollars per month. The need to communicate is the very first basic desire any new mobile phone handler thinks of while buying a hand set. But in recent years, the use of the mobile phone has evolved from just a hand held communication gadget to a bank, credit store, business card and a medium for making life easier.
With a simple SMS (Short Message Service), one can now pay bills like water, electricity, cable TV to basics like buying food and paying school fees. Businesses can reach a selected target audience with syndicated smses advertising their latest products and one can now check, transfer and make various money transactions without visiting their banks. By sending a text to a particular code, one can also find out about the day’s currency exchange rates, costs of selected food items and weather conditions.
Research companies and government agencies can reach masses with just a text of forty letters. The mobile phone has created a whole new faster, efficient and mass world never seen before. Uganda now boasts five mobile operators including MTN Uganda, Uganda Telecom, Airtel which recently merged with Warid Telecom, Orange Uganda and K2 Telecom. A sixth operator managed by Reliance Communications of Uganda is due to enter the market soon.
According to the report on communication markets in Uganda, mobile penetration rose from just 1.9 percent at the end of 2002 to an estimated 39.0 percent in 2009. This is expected to rise further, reaching 70.7 percent penetration by 2014, while the number of mobile subscriptions will exceed 27 million from the current 18 million. Such figures have presented an enormous opportunity for many people who have utilised the mobile phone as a platform to create business opportunities.
For example, the Uganda Aids Commission didn’t have to look far when challenged by the increasing rates of HIV transmission. Faced with rising infection figures, policy makers took to more inventive ways of educating people about the virus. The tool they chose to drive the campaign on reduction of these figures was mobile phone technology, whose rapid growth has provided an avenue that could potentially reach millions with messages.
Text to Change (TTC) , an NGO that uses a bulk short message service (SMS) platform for HIV/AIDS education, partnered with the AIDS Information Centre (AIC) and Airtel, a local mobile phone network, to pilot a project in western Uganda aimed at communicating knowledge about the disease and encouraging subscribers to volunteer for HIV testing. Needless to add, the results have been impressive.
Agriculture fortunes
With the majority of Uganda’s economic activities hinged on agriculture, the backbone of the economy, currently employing 77% of the population, the mobile phone penetration has helped make the lives of farmers easier. Knowing where and at how much to sell their produce with the use of their mobile phones has transformed communities and eliminated middle men who used to exploit these farmers, while at the same time mobile networks are making money from voice and data.
Building Wealth; Five Ugandan Entrepreneurs Democratizing Access to Investments.The information farmers in those previously hard to reach areas provided via mobile phones does more than just help them order and pay for supplies. It allows the collection of data that will help them sell their crops, build a credit history, and receive other services, such as crop insurance. A powerful new mobile platform combining agriculture information and financial services specifically designed for smallholder farmers is going live in Uganda, helping farmers plough even more value from each acre.
One such innovation that is a result of increased mobile penetration and the increasing role of mobile technology to grow the economy especially the cash intensive sectors like agriculture is AgriLife, a cloud based platform. The platform will be accessible via mobile phone and provide two key, interconnected services: data collection and analysis about farmers’ production capability and history. It will also be an integration point for financial institutions, mobile network operators, produce buyers, and their agents to more efficiently provide much needed services to distant, rural farmers.
Government and revenue in the mix
At the reading of the 2013/2014 annual budget, Finance Minister, Maria Kiwanuka announced a 10% tax introduction on all mobile money transaction fees. The government said it expects this to generate Ushs32 billion (US$12 million) annually from the tax. Uganda is a highly competitive market for mobile money, with over 9 million registered clients and six mobile money deployments.
Mobile money platforms have contributed significantly to the increase in the number of access points to financial services in the country as well as helping to achieve the financial inclusion goal and also contributing towards greater government efficiency (by using mobile technology for the payment of public employees’ salaries and to make social payments, and also by reducing the cost of cash management). On the global front, it is estimated that more than a billion people in emerging and developing markets have cell phones but no bank accounts.
Many low income people store and transfer money using informal networks, but these have high transaction costs and are prone to theft. Mobile money is beginning to fill this gap by offering financial services over mobile phones, from simple person to person transfers to more complex banking services.
In March last year, MTN Uganda in a bid to tap the growing number of remittances by Ugandans in the Diaspora who send back home cash transfers that have made it the number one foreign exchange earner partnered with Western Union enabling its customers send and receive money on their mobile phones from anywhere in the world, allowing users cut down on visits to Western Union branches to pick up cash. Instead with the new arrangement, they can “pull
